Japan’s biggest investment bank Nomura has begun restructuring its lossmaking joint venture in China after failing to secure the licences needed to expand its business in the country. The joint venture, which was established in 2019, has already shed 8 per cent of its staff since the end of July and may be forced to cut more jobs after an assessment likely to be completed before the end of the financial year in March 2024, said people familiar with the matter.

Nomura was one of the first foreign investment banks given permission to operate a majority-owned joint venture in China but has since struggled to make a profit. Last year its joint venture, called Nomura Orient International, made a loss of Rmb225mn ($31mn), an increase from the loss of Rmb85mn it made in 2021, according to filings.

Former Nomura chief executive Koji Nagai launched the joint venture in China as part of a plan to find growth outside Japan. Nagai wanted to secure an investment banking licence in China by the end of 2023, which would have allowed Nomura to directly compete with local banks offering lucrative services such as merger and acquisition advisory.